The Bargaining Game
The bargaining game or Nash bargaining game is a simple two-player game used to model bargaining interactions. In the Nash Bargaining Game two players demand a portion of some good (usually some amount of money). If the total amount requested by the players is less than that available, both players get their request. If their total request is greater than that available, neither player gets their request. A Nash bargaining solution is a (Pareto efficient) solution to a Nash bargaining game. According to Walker (2005), Nash's bargaining solution was shown by John Harsanyi to be the same as Zeuthen's solution of the bargaining problem (Problems of Monopoly and Economic Warfare, 1930).
Read more about this topic: Bargaining Problem
Famous quotes containing the word game:
“My first big mistake was made when, in a moment of weakness, I consented to learn the game; for a man who can frankly say “I do not play bridge” is allowed to go over in the corner and run the pianola by himself, while the poor neophyte, no matter how much he may protest that he isn’t “at all a good player, in fact I’m perfectly rotten,” is never believed, but dragged into a game where it is discovered, too late, that he spoke the truth.”
—Robert Benchley (1889–1945)